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The reforms behind the Doing Business rankings

Cecile Fruman's picture



In Mozambique in 2003, it took an entrepreneur 168 days to start a business. Today, it takes only 19 days. That kind of transformation has major implications for ambitious men and women who are seeking to make a mark in business, or, as is often the case in Africa, seeking to move beyond a life in agriculture. In economies with sensible, streamlined regulations, all it takes is a good idea, and a couple of weeks, and an entrepreneur is in business.

This week, the World Bank Group launched its annual Doing Business 2016 report, which benchmarks countries based on their progress undertaking business reforms that make it easier for local businesses to start up and operate.

For the second straight year, Singapore topped the list, with New Zealand, Denmark, the Republic of Korea, and Hong Kong SAR, China, coming in closely behind.

In the developing world, standouts included Kenya and Costa Rica, both of which rose 21 positions; Mauritius, Sub-Saharan Africa’s top-ranked economy; Kazakhstan, which moved up 12 places to rank 41st among all countries; and Bhutan, which topped South Asia’s list of reformers. In the Middle East and North Africa, 11 of the region’s 20 economies achieved 21 reforms despite the challenges caused by a number of civil and interstate conflicts.
 
The reforms tracked by Doing Business are implemented by governments, but the results show up most in the private sector, which is critical to driving a country’s competitiveness and to creating jobs. Ensuring an enabling environment in which the private sector can operate effectively is an important marker of how well an economy is positioned to compete globally. 
 
For those of us working with governments to help improve their investment climates – and to create a policy environment in which business regulatory costs are reasonable, access to finance is open, technology is shared, and trade flows within and across borders – the real work begins long before the Doing Business rankings are published.

In the World Bank Group’s Trade and Competitiveness Global Practice (T&C), our mandate is to work with developing countries to unleash the power of their private sector for growth. Much of this work involves reforms in the very areas measured in the Doing Business report: starting a business, dealing with construction formalities, or trading across borders, among other factors.

Our experience working with clients confirms one of this year’s key findings: Regulatory efficiency and quality go hand-in-hand. A good investment climate requires well-designed regulations that protect property rights and facilitate business operations while safeguarding other people’s rights as well as their health, their safety and the environment.

What Can the Asian Tigers and Latin Pumas Learn From Each Other?

Danny Leipziger's picture

The global landscape these days is not a pretty one: collapsing commodity prices, weak demand in the OECD economies and a pronounced slowdown in many emerging markets, unpredictable capital flows affecting exchange rates, and a noticeable slump in world trade. This is clearly not a good time to be a Minister of Finance!

 
This is the panorama that surrounds the IMF World Bank Annual Meetings in Lima, October 8-10. The weak global picture is heavy on diagnostics of what is troubling many developing countries, but less robust on the side of policy solutions. In Lima, this will be one of the key topics of discussion during a high-level debate on “Balancing sustainable growth and social equity”.

Part of the #Youthbiz movement? Share your story!

Valerie Lorena's picture

Also available in: Français | العربية
 



A boat trip from Port Elizabeth to Kingstown, in the Caribbean country of Saint Vincent and the Grenadines, is a one-hour trip that locals take several times a day. It was during one of these journeys that the boat of Kamara Jerome, a young Vincentian fisherman, ran out of gas six miles from Bequia City in what is termed locally as the "Bequia Channel." While waiting for help with strong wind gusts and the sun on his head, the idea of developing a boat that would run with wind and solar energy was born. Soon after, the idea became a prototype; a boat using green technology was on the water making 20-year-old Jerome a winner of international innovation competitions and a role model to other Caribbean youth. 
 
In Mexico, young engineer Daniel Gomez runs a multimillion bio-diesel company originally conceived as a research project for his high school chemistry class. Gomez and his partners - Guillermo Colunga, Antonio Lopez, and Mauricio Pareja - founded SOLBEN (Solutions in bio-energy in Spanish) in their early twenties. 
 
Although Daniel and Kamara have different educational backgrounds, they do share one important skill, the ability to identify a problem, develop an innovative solution, and take it to the market. In other words, being an entrepreneur, an alternative to be economically active, that seems to work and not only for a few.

Bridging the Gap in LAC Infrastructure

Karin Erika Kemper's picture


The other day I had the opportunity to participate in the annual CAF conference on Infrastructure, this time held in Mexico City. The conference featured CAF's new IDEAL report on the state of infrastructure in Latin America and the conference, attended by many decision and opinion makers from across LAC, was organized around findings of the report.
 
I had a few takeaways from the discussions, notably that (1) there is convergence on a range of key issues and (2) there are some important Bank messages that are unique:

Building on Central America’s Strengths



Soon will be January 1, 2015. Most of us will make New Year’s resolutions and most of us will fail to keep them. Keeping New Year’s resolutions is hard. But it turns out that we are much more likely to make good on our resolutions if we decide to build upon our strengths rather than focus on fixing what’s wrong. This insight is all the more important if we combine it with the intriguing view that it is the depth of our strengths, not the absence of weaknesses, which makes us successful. People are successful not because they are perfect but because they have deep strengths. What if this was also the case for countries?

With this in mind I turn my attention to some of the strengths of El Salvador, Guatemala, and Honduras, three countries that have recently put together their Plan of the Alliance for Prosperity in the Northern Triangle.” The Plan is in part a response to the well-known security challenges facing those countries and the challenges posed by the surge in unaccompanied migrant children but it is also an opportunity to focus on the strengths of the Northern Triangle of Central America and how to develop them even further. And when one goes beyond the headlines one discovers a variety of success stories.

Open Contracting Data Standard: Better Data for Better Decisions

Marcela Rozo's picture
Future is Open


Informed decision-making is crucial to the success of policies and reforms that foster growth and prosperity. So, how can we help decision makers make better decisions?
 

Who speaks for public media in Latin America?

Silvio Waisbord's picture

Latin America has a long, fractured, and ultimately failed history of public media. So-called “public media” typically functioned as government-controlled institutions for spurious goals - propaganda and clientelism - rather than quality content in the service of multiple public interests. 

How to Break the Curse of Unemployment: Jobs First or Skills First?

Omar Arias's picture

Some Skills should Come Before Jobs, Others Develop with the Job
 
Students work on an engine at Sisli Vocational High School To be clear from the onset: I will not oversimplify the unemployment (or inactivity) problem in the Western Balkan countries as solely due to a lack of skills in the population. Low employment rates result from both insufficient creation of jobs by enterprises and too-high a fraction of the workforce that is ill-equipped to take on the jobs that a modern economy creates. Both issues are intertwined. Solutions, therefore, require efforts on several fronts to enable a more vibrant private sector –including improvements in the business environment, enterprise restructuring, integration in global markets and promoting entrepreneurship— as well as to prepare workers for new job opportunities.

Supporting Entrepreneurs: Breaking Down Barriers for Access to Finance

Irene Arias's picture

​Small and medium sized companies are the backbone of Latin America’s economy. They represent more than 90 percent of all enterprises in the region, generating over half of all jobs and a quarter of the region’s gross domestic product. They are essential to economic growth, yet their success is often blocked by one key obstacle: lack of credit. Nearly a third of companies in the region identified lack of credit as a major constraint, according to recent surveys.

Take the case of Sonia Arias, who owns a small textile business in Medellin, Colombia. When she opened her business seven years ago, she took an informal loan that left her with sky-high interest rates and little cash to reinvest. “When I was paying these loans,” she said, “it felt like we were being hit with a stick.”

The WTO Environmental Goods Agreement: Why Even A Small Step Forward Is a Good Step

Miles McKenna's picture

Will the WTO be the first global organization to take action on climate change? Source - VerticalarrayInternational trade has a critical role to play in environmental protection and the effort to mitigate climate change. While it certainly isn’t always framed this way, it is important to realize that increased trade and economic growth are not necessarily incompatible with a cleaner environment and a healthier climate.

If we are going to move away from dirty fossil fuels and inefficient energy processes at a rate necessary to limit the likely devastating results of a warmer planet, then we need enabling policies in place—especially when it comes to trade policy.

That’s why, this week, a group of 14 World Trade Organization (WTO) Members are meeting to begin the second round of negotiations on the Environmental Goods Agreement (EGA)—an effort aimed at liberalizing trade in products that help make our world cleaner and greener.
 


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